Institute for Social and Economic Change
Working Paper: 461
Dynamics of Procurement of Modern Food Retail Chains:
Evidences from Karnataka
What criteria do supermarkets consider for selecting their Fruits and Vegetables (F&Vs) suppliers? How supermarkets changing the methods of procurement? What are the major procuring areas in Karnataka? This paper attempts to study these factors along with existing methods of sourcing fruits and vegetables by the Modern Food Retail Chains (MFRC). The paper is based on the primary data collected during 2017 in Karnataka. The research sample consists of forty procurement managers of the MFRC. The findings of the paper indicate that MFRC which procure F&Vs at farm field level apply four main assessment indicators for identifying the suppliers, namely scale efficiency, suppliers’ capability and ability (minimum requirement), suppliers’ quality of the product and safety requirements. Our evidence shows that MFRC managers give more weight for the safety requirement of F&Vs. Further, the study observed three major spots emerged in Karnataka where MFRC have established either collection centres or were procuring directly from farmers’ fields. It is observed that MFRC procure 90 per cent of the F&Vs from collection centres and the remaining 10 per cent from farmers’ fields.